GST- a way forward for logistic industry

Goods and Services Tax - GST - By: - sandeep saini - Dated:- 22-9-2016 Last Replied Date:- 4-11-2016 - Dear professional colleague, India s globally infamous unending queue, uneasy checkmates at our border check posts, filing of waybills/entry permits, compliances under entry tax laws and local levies, are one of the prime reasons why transport costs hovered high for decades. But once the GST implemented , these challenges will become a thing of past, as GST will subsume most of Central taxes an .....

billion annually with GST implementation, due to faster movement of goods and minimal idling. Logistic players have started dreaming about a borderless, barrier-less tomorrow when the goods will move on seamlessly. Presently, the logistical costs within India is high and the same is supported by ample evidences. According to one study, for example, in one day, trucks in India drive just 280 kms as against 800kms in US, due to which costs increases viz. wages of drivers, extra fuel usage due to r .....

could keep trucks moving almost 6 hours more per day, which will results in additional movement of 164 kms per day. Due to above bottlenecks, logistics costs are higher than the wage bill or the cost of power and 3-4 times the international benchmark. The removal of bottlenecks becomes more important for India, as the share of roads in freight traffic is about 72 per cent, which is much higher in comparision to other countries and rising over time because of under investment in railways, therefo .....

ply chain desigh will be based on demand management and logistical benefits rather than tax costs. The tax procedures will be reduced significantly under GST and the companies would prefer to hold inventory in just one large central warehouse, rather than stocking goods in various smaller warehouses, as the standard rate of taxes would be more or less uniform across India, which will preclude the need for multiple warehouses across states. So, instead of transporters, they will prefer third-part .....

rease upto 50 per cent, after implementation of GST. The companies and logistic firms will be in a position to use fewer but bigger trucks to transport their consignments, further reducing pollution and curbing traffic congestion.And many companies would prefer to outsource logistic operations, as lower costs make this viable. Steps that logistic service providers need to undertake Develop a stong team to manage sophisticated technology enabled fufilment centre. Indentify focus Industries that n .....

y octroi e.g Municipality like BMC will continue with collecting octroi. Logistic sector should be incentivise, by providing lower GST rates for capital equipment, inputs and input services for setting up warehouses and other infrastructure should be provided. The ancillary services used for the export of goods should also be provided the same treatment as international freight, i.e. zero rating, which will be in accordance with the international practices adopted in Canada, Singhapore, UK and E .....

ia would be implemented besides Make in India . - Reply By Ganeshan Kalyani - The Reply = nice article.i would like to reproduce the extract of Model GST law for discussion,60. Power of inspection, search and seizure(1) Where the CGST/SGST officer, not below the rank of Joint Commissioner, has reasons to believe that -(a) a taxable person has suppressed any transaction relating to supply of goods and/or services or the stock of goods in hand, or has claimed input tax credit in excess of his enti .....